Using MedPay for Medications After a Car Accident

Amar Lunagaria — Co-Founder & Chief Pharmacist, LienScripts | July 24, 2024 | 8 min read

Medical Payments Coverage (MedPay) pays for accident-related medical expenses — including prescriptions — regardless of fault and before health insurance. But MedPay limits exhaust quickly, especially with specialty medications. Here is how MedPay and pharmacy liens work together to cover the full cost of treatment.

Using MedPay for Medications After a Car Accident

Medical Payments Coverage — commonly called MedPay — is a first-party auto insurance benefit that pays for medical expenses resulting from a car accident regardless of who was at fault. Most drivers have it and many don't know it exists until they need it.

For PI attorneys, understanding how MedPay interacts with pharmacy coverage is essential: MedPay is often the first source of payment for prescriptions, but it exhausts quickly, and how it is handled at settlement affects the client's net recovery.

[!KEY] MedPay and a pharmacy lien work sequentially — MedPay pays first for early prescription costs up to the policy limit, and a pharmacy lien covers the ongoing medications that continue once MedPay is exhausted.

What MedPay Is and How It Works

MedPay is an optional coverage available in most states that pays for reasonable medical expenses for the policyholder and passengers injured in the covered vehicle. Key characteristics:

First-dollar coverage. MedPay pays from the first dollar of medical expenses, without a deductible, regardless of fault. A driver who causes an accident and is injured still receives MedPay benefits.

Pays before health insurance. MedPay is primary over health insurance for accident-related expenses. Health insurance becomes secondary once MedPay is exhausted.

Covers prescriptions. Medications are "medical expenses" under virtually all MedPay policies. A patient filling a prescription for post-accident pain management, nerve damage, or migraine can have those costs paid by MedPay.

Policy limits are modest. MedPay policies typically carry limits of $1,000, $2,500, $5,000, or $10,000. Some states offer higher limits. These amounts sound substantial until you consider that a single month of CGRP migraine medication can cost several hundred dollars, a specialty medication for PTSD can cost similar amounts, and a patient with multiple injury conditions may be on four to six medications simultaneously.

Why MedPay Exhausts Quickly

The medications prescribed for serious accident injuries are often specialty pharmaceuticals with costs that dwarf the typical MedPay limit:

  • CGRP monoclonal antibody injections (Aimovig, Emgality) for post-traumatic migraine
  • Oral CGRP agents (Qulipta, Nurtec ODT) for migraine prevention and acute treatment
  • Rexulti (brexpiprazole) for PTSD as adjunct therapy
  • Journavx (suzetrigine) for acute moderate-to-severe pain
  • Sleep medications (Quviviq, Dayvigo) for trauma-related insomnia

A patient with post-traumatic migraine, sleep disruption, and nerve pain from a herniated disc may need three to five specialty medications. Even a $10,000 MedPay limit can be exhausted within two to three months when treating multiple conditions with specialty pharmaceuticals.

Once MedPay is exhausted, the patient has no first-party coverage left and must rely on health insurance (if available), out-of-pocket payment, or a pharmacy lien.

MedPay and Pharmacy Liens as Sequential Coverage

The most common and practical arrangement in PI cases is sequential:

  1. MedPay pays first for prescriptions, up to the policy limit
  2. Pharmacy lien covers the remainder once MedPay is exhausted

This sequencing works because MedPay is a contractual right the patient purchased — using it does not reduce the liability claim against the at-fault driver. The at-fault driver's insurance does not benefit from the patient's MedPay payment.

Practically, some patients enroll in a pharmacy lien from the start and route all prescriptions through the lien, with MedPay used for other medical expenses (ER visits, imaging, physical therapy). Others exhaust MedPay on early prescriptions and then transition to a pharmacy lien. Either approach works as long as the attorney tracks the coverage sources.

MedPay Subrogation: The Settlement Complication

Most MedPay policies include a subrogation clause: if the policyholder recovers damages from a third party (the at-fault driver), the auto insurer can seek reimbursement for MedPay benefits paid.

This creates a lien at settlement that the attorney must account for alongside any medical or pharmacy liens. Important nuances:

Made-whole doctrine. Several states (and general equitable principles) hold that an insurer cannot assert subrogation until the insured has been fully compensated — "made whole." If the settlement is insufficient to fully compensate the plaintiff, the MedPay subrogation claim may be reduced or eliminated.

Contractual modification. Some MedPay policies limit or waive subrogation rights as a selling point. Read the policy language.

Anti-subrogation statutes. A minority of states (including Louisiana and North Dakota for some coverages) limit or prohibit MedPay subrogation by statute.

The practical effect: MedPay prescription payments that trigger subrogation will reduce the client's net recovery. The attorney should calculate the total subrogation exposure when evaluating settlement amounts and negotiating lien reductions.

[!KEY] The made-whole doctrine can eliminate or dramatically reduce a MedPay subrogation claim — if the settlement does not fully compensate your client, asserting the made-whole doctrine against the MedPay carrier before disbursement can protect a significant portion of your client's net recovery.

[!TIP] MedPay prescription payments are part of the plaintiff's documented damages against the at-fault driver — include them in your demand even though MedPay has already paid them, because the full medical cost is still relevant to the liability claim.

Documenting MedPay Payments as Damages

A strategic point that PI attorneys sometimes miss: MedPay payments for accident-related prescriptions are medical expenses paid on behalf of the plaintiff — they are part of the damages claim against the at-fault driver.

Even though MedPay is the plaintiff's own insurance, the medical expenses it covered represent the real cost of treating the plaintiff's injuries. These costs should appear in the damages demand regardless of the payment source. The fact that a $8,000 MedPay benefit was paid does not mean the plaintiff's prescription damages are only $8,000 — it means $8,000 in prescription damages have been partially satisfied, but the full damage amount is still relevant to the liability claim.

Keep documentation of what MedPay paid, when, and for which prescriptions. This creates a clean accounting at settlement.

[!KEY] MedPay prescription payments belong in your damages demand to the at-fault carrier even though MedPay has already paid them — the full cost of treating the plaintiff's injuries is the proper measure of economic damages, regardless of the payment source.

State Variations: Where MedPay Is Mandatory vs. Optional

MedPay availability and requirements vary by state:

States where MedPay or equivalent coverage is mandatory:

  • Maine, New Hampshire, Maryland (MedPay required at minimum limits)
  • Oregon (Personal Injury Protection, similar to MedPay, required)

States where MedPay is offered but optional:

  • Most states — insurers must offer it, but the policyholder chooses whether to purchase

No-fault states (PIP instead of or alongside MedPay):

  • Florida, New York, Michigan, New Jersey, Pennsylvania, Hawaii, Kansas, Kentucky, Massachusetts, Minnesota, North Dakota, Utah — these states have Personal Injury Protection (PIP) that overlaps significantly with MedPay. See our PIP guide for these states.

Practical implication: When onboarding a new PI client, confirm whether they have MedPay and the policy limit. In states where MedPay is optional and limits are modest, a pharmacy lien from the start of treatment is often the cleaner option.

LienScripts works alongside MedPay coverage to ensure clients receive uninterrupted prescription access regardless of coverage limits. Contact LienScripts to discuss how pharmacy liens integrate with your clients' coverage situation.

Related Resources

Frequently Asked Questions

Does MedPay cover prescription medications after a car accident?

Yes. Prescriptions are medical expenses covered under most MedPay policies. MedPay pays for accident-related prescriptions from the first dollar, without a deductible, regardless of fault. However, MedPay policy limits are typically $1,000–$10,000 — amounts that can exhaust quickly when specialty medications are involved.

Can a PI client have both MedPay and a pharmacy lien?

Yes, and this is common. MedPay pays first for prescription costs, up to the policy limit. Once MedPay is exhausted, the pharmacy lien covers subsequent prescriptions. The two coverage sources work sequentially, not in conflict.

Does using MedPay create a subrogation lien at settlement?

Most MedPay policies include a subrogation clause giving the auto insurer a right to reimbursement from the liability settlement. This MedPay subrogation claim must be accounted for alongside medical and pharmacy liens at settlement. Some states limit subrogation under the made-whole doctrine — the insurer cannot recover until the plaintiff is fully compensated.

Is MedPay mandatory in my state?

MedPay is mandatory at minimum limits in a small number of states (including Maine, New Hampshire, and Maryland). In most states it is optional — insurers must offer it but policyholders choose whether to buy it. No-fault states have PIP, which serves a similar function with higher required limits. Always check the client's declaration page to confirm coverage.